France balks at delivering new warship to Russia

PARIS, Sept 3 (Reuters) - France will not deliver the first
of two helicopter carriers to Russia for now because of Moscow's
actions in eastern Ukraine, the French president's office said
on Wednesday.

France, due to join NATO partners at a summit in Britain
from Thursday, has faced fierce pressure from Washington and
other allies to halt the sale of the Mistral-class warships, the
first of which had been due for delivery in October.

Four hundred Russian sailors have been training to operate
the carrier since the end of June in shipyards at Saint-Nazaire,
on France's Atlantic coast.

Warning Moscow that it could face more sanctions, President
Francois Hollande said last week it would be "intolerable and
unacceptable" if it were proven that Russian forces had entered
Ukrainian territory, something Russia denies.

"Russia's recent actions run against the foundations of
security in Europe," said a statement issued by Hollande's
office after a meeting between the president and his top
military advisers.

"The president of the republic has concluded that despite
the prospect of ceasefire, which has yet to be confirmed and put
in place, the conditions under which France could authorise the
delivery of the first helicopter carrier are not in place."

Russian President Vladimir Putin outlined a plan for a
ceasefire in eastern Ukraine on Wednesday, but the Ukrainian
prime minister accused him of trying to deceive NATO ahead of
the summit to head off new European Union sanctions.

Following the presidency's statement, Foreign Minister
Laurent Fabius was careful not to close the door entirely to the
possibility of France delivering the warship.

"The decision that the president had to take was: Are the
conditions there today for the delivery. No, but we hope that
they will be in the future," Fabius said on BFMTV.

NO "TRAGEDY"

Russia's Defence Ministry played down the French decision,
saying it would not hinder the modernisation of its military nor
hold back its reform plans, Itar-Tass news agency reported.

"Although of course it is unpleasant and adds to certain
tensions in relations with our French partners, the cancelling
of this contract will not be a tragedy for our modernisation (of
the army)," Deputy Defence Minister Yuri Borisov told the
Russian news agency.

Its decision to hold off delivery is likely to take the heat
off France when NATO leaders meet in Wales for a summit focused
largely on the conflict in Ukraine and growing tensions with
Russia.

"Unfortunately, Russia has made this kind of decision the
only possible decision by its actions," a senior NATO official
told reporters in Newport, northeast of the Welsh capital
Cardiff, before the summit.

France has until now resisted allies' pressure to halt
delivery of the warships, saying that doing so would hurt Paris
more than Moscow.

In Washington, U.S. State Department spokeswoman Jen Psaki
welcomed France's decision, saying at a daily briefing: "We do
think that was a wise decision."

As recently as July, Hollande said France would honour the
contract for the first carrier, but that he was prepared to
review the second due to be delivered in 2016.

And on Tuesday, French diplomats had suggested that delivery
of the first helicopter carrier was likely to go ahead.

Paris has repeatedly said other countries must share the
burden in imposing a new round of sanctions on Russia and that
any measures should also include the energy and financial
sectors as well as defence.

Signed by then-president Nicolas Sarkozy's conservative
government, the 1.2 billion euro ($1.58 billion) contract for
two warships was the first by a NATO member country to supply
Russia with military equipment.

"Russia used to have a closer partnership with NATO than
other countries through the NATO-Russia Council," one
high-ranking NATO diplomat said in Newport. "But this Russia
today is no partner."
(U.S. $1 = 0.7609 euro)
(Additional reporting by Julien Ponthus in Paris, Adrian Croft
and Sabine Sebold in Newport and Alissa de Carbonnel in Moscow;
editing by Angus MacSwan and Gunna Dickson)